tag:blogger.com,1999:blog-7415200061127467028.post3798386136316127567..comments2023-09-18T02:20:57.133-07:00Comments on Finance Monitor: Another Look at the Mortgage Bond InsurersFinance Monitorhttp://www.blogger.com/profile/00569154006489050897noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-7415200061127467028.post-12677619267822785892010-07-23T16:32:47.273-07:002010-07-23T16:32:47.273-07:00When this quarter's earnings come out, I'l...When this quarter's earnings come out, I'll give them all a good go through. I think there is value to be had here, but we have to be careful.Finance Monitorhttps://www.blogger.com/profile/00569154006489050897noreply@blogger.comtag:blogger.com,1999:blog-7415200061127467028.post-172603717718355942010-07-22T21:44:08.436-07:002010-07-22T21:44:08.436-07:00MTG was the preferred option of these when I was j...MTG was the preferred option of these when I was just idly skimming their information this morning, as well. Effective as of May, MGIC released a new set of delegated guidelines to all of their mortgage servicing partners. The details are not especially important, but the overall influence is. It's the rare loan that falls outside of their delegated guidelines, meaning they'll approve modification for almost any distressed borrower if the servicer decides to do so and the lender approves. Loans falling outside of the delegated guidelines need only have a few certain other requirements met to be approved, as well. This is causing MGIC to pay out fewer claims and spend much less money and manpower approving modification requests.<br /><br />In addition, it turns out that the backlog of modification requests is industry-wide for the servicers, so although the threat of foreclosures remains it's much more likely that lenders will maintain their massive modification operations active through the next 2-3 years and spare the insurers a great deal of payouts. I would imagine MGIC has few places to go but up.<br /><br />Radian is a tougher issue. Servicers are completely delegated but they will not modify over original principal balances. Since most of the defaulting loans are very new, there are a lot of Radian loans that go to foreclosure or short sale, forcing them to continue paying lots of claims.<br /><br />PMI is the only one I know about, and I don't know much. They're another of the insurer with delegated guidelines, but they just aren't as common as MGIC so it's hard to judge from my experiences so far. Waiting and watching seems a fair plan, at this point.Steven Carlsonhttps://www.blogger.com/profile/14598248355848874750noreply@blogger.com